Saudi Arabia Upcoming in the Pharmaceutical Industry?

You might not associate Saudi Arabia with much other than oil, but according to recent studies, they have much, much more to offer.

A press release recently published on 4-traders.com says that Saudi Arabia is in a prime position to grow their pharmaceutical industry.  According to the article, Saudi Arabian organizations accounted for more than 50% of all pharmaceutical sales in the Gulf Cooperation Council (GCC) region.  If fact, the author even goes so far as to say that Saudi Arabia will surpass the US in pharmaceutical product sales by 2018.

The release attributes the growth to several factors, including a growing elderly population (specifically in the above 60 years segment), shifting demographics and a recent growth in incidence of lifestyle diseases.  Also credited are increased private sector spending and government initiatives to support the growth of young drug companies.

Another thing on their side is technology.  According to the author, Saudi Arabia is one of the most technologically advanced countries in the GCC, particularly in terms of medical equipment and amenities.  Lastly, the author argues that trade agreements and health care reform have allowed the medical industry to grow rapidly in Saudi Arabia.  Policies like price regulation guidelines, combined with increased activity from insurance providers has provided significant opportunities for growth in the last few years.

Despite these positive signs, the release also argues that Saudi Arabia is in a “nascent” phase of its growth, meaning it still has a long way to go to become a leader in the field.

Among the challenges Saudi Arabia faces are a heavy reliance on imports.  The country has an underfunded infrastructure for research and development, the author writes, so they have to import large amounts of product from Europe.  Until they can cultivate an environment friendly to young entrepreneurs in the industry, it looks like this costly reliance will continue.

Overall however, it’s important that we keep our eye on Saudi Arabia as they begin to expand their pharmaceutical sales and grow their market share into global markets.